'Millions' of Brits could be owed thousands if one thing on your payslip is incorrect

People are being encouraged to scrutinise a specific number on their payslip, as they could be due thousands of pounds in overpaid income tax. Martin Lewis, via his website Money Saving Expert, has urged Brits to examine their tax code, which can be found on your payslip or other documents such as a P45, P60, or pension advice slip.

According to Martin, each year millions of people discover their tax codes are incorrect. He stated: "Is your tax code correct? If not, you could be owed £1,000s."

He emphasised that it's the responsibility of the employee, not the employer or HM Revenue & Customs (HMRC), to check their tax code.

He said: "If you're an employee (ie, you work for someone), it's important to understand that legally your tax code is your responsibility to check, not your employer's nor HM Revenue & Customs'. Millions of these are wrong each year."

This could mean that you've been overpaying and are due a refund, or underpaying, which could result in an unexpected bill in the future.

"If yours is, you may be overpaying tax and due money back, or underpaying and likely to face bill shock in future," he warned. One MSE reader took Martin's advice and managed to reclaim nearly £10,000.

In an email, reader Michele revealed: "I discovered I was paying on every penny I earned, without any allowance.

"Likely because I'd been self-employed, but I stopped trading three years ago, and my tax code for my salaried employment was not changed.

"It took an hour on the phone, but I have never earned so much in an hour, I have now been refunded £9,400! Thank you so much Martin."

Your tax code appears as a series of letters and numbers. Examples include 1257L, S1257L, C1257L, BR, and K497.

If you're a full or part-time employee, or receive a private pension, your employer(s) or pension providers will use this code to calculate the amount of tax to be deducted from your wages or pension before it's paid into your bank account.

This is part of the pay-as-you-earn (PAYE) system.

However, not everyone is taxed in this way. If you're fully self-employed, unemployed or only receive the state pension, you won't have a tax code.

MSE advised: "Each income you have (jobs, private pensions) will have a different tax code. Remember to check them all."

You can find your tax code on your:

• Payslip
• PAYE coding notice (or P2)
• P45
• P60
• Pension advice slip

You can also check your tax code with HMRC online or by using its app. If you know your code you can use the MSE tax code calculator here to see if you're owed a rebate.